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Post-Alice Patent-Eligible Business Methods

Post-Alice Patent-Eligible Business Methods published on 2 Comments on Post-Alice Patent-Eligible Business Methods

Although many aspects of the Alice opinion are unclear, one definite result is that Alice did not hold that “business methods” are categorically excluded from patent protection.

This result raises the question: What types of business methods would be patent-eligible under Alice? This article considers some hypothetical business method inventions, and how such inventions might be claimed in a manner that is likely to satisfy the heightened patent-eligibility requirements of Alice.

“Justices Deny Patent to Business Methods,” the New York Times breathlessly proclaimed on the day of the Supreme Court Alice decision. The Times article began: “The Supreme Court unanimously ruled on Thursday that basic business methods may not be patented, even if computers are used to apply them.”

However, that summary is at odds with the actual Alice majority opinion, which does not use the term “business methods” even once. Indeed, the Alice Court may not have felt it necessary to address the prospect of a categorical exclusion of business methods from patent eligibility, because the Court rejected this concept in the Bilski decision in abundantly clear language. 1 Of course, this broad rejection of a categorical business method exception is not also a broad endorsement of the patent-eligibility of business methods. Indeed, the central holding of both cases is a constraint on the scope of business methods that are patent-eligible. Alice can be read as an expansion of the “laws of nature, natural phenomena, and abstract ideas” patent-eligibility exception to also include methods of “organizing human activity” and “fundamental economic and finance practices.”

This contrasting backdrop raises the obvious question: What types of business methods remain patent-eligible after the Alice decision?

Of course, the Court interpreted this question from a top-down perspective: “What is the legal framework for determining whether a claim is or isn’t patent-eligible?”, and answered with the Mayo framework: “Identify whether the claims recite an ‘abstract idea,’ and then determine whether the claims provide ‘something more’ than the abstract idea.” Yet, this analysis is unsatisfying for a variety of reasons.

Instead, it is interesting to consider this question from a bottom-up approach: How should business methods be disclosed and claimed in a manner that is likely to survive review under Alice?

At present, it is difficult to answer this question with complete certainty, given the extremely one-sided approach of courts to Alice to date, the conflicting rationale cited by courts in applying Alice, and particular examples that demonstrate the volatility in this area of law.

While we await clarification from the courts, we can speculate about techniques for satisfying the Court’s perceptions of “something more” added to an “abstract” business method to achieve patent-eligibility. The examples below present a hypothetical business-method invention from both a typical pre-Alice perspective and a post-Alice perspective.

(N.B. #1: The following examples are not related to any invention or the subject of any patent or patent application; they are purely hypothetical.)

(N.B. #2: The following abstracts and claims are presented for plain-English readability, rather than legal sufficiency or good practice. Many details are simplified or omitted that are not related to the objectives of this article. Modeling a patent application or claim on these examples would be a terrible idea.)

Invention #1: Determining Vendor Persuasiveness

The Invention:
Allocate marketing resources for products based on the influence of each information source on customers’ purchasing decisions.


Today’s customers typically conduct research before purchasing a product, and this research may make it difficult to allocate marketing efforts in an effective way.

According to the present invention, a device can track customers’ engagement with information sources about a product prior to a purchase. The information about customer engagement can enable a determination of the influence of each information source on the customer’s purchase decision. Marketing resources can be directed to information sources about the product that are determined to be more influential to customers’ decisions.


Today’s customers typically conduct research online before purchasing a product. Marketing resources may be efficiently allocated based on which information sources are influential to potential customers.

However, even if vendors can determine which information sources a customer researched in relation to a product purchase, determining the influence of the information sources on the customer may be difficult. First, raw access logs may not be sufficiently informative. For example, a user’s visit may be recorded in a server log, but such a record may not indicate whether the user thoroughly reviewed and considered the information; whether the user only glanced at the information briefly; or whether the visit was unintentional or unsolicited, where the user promptly discarded the information without review. Second, even if a user reviewed an information source in detail, it may be difficult to draw reliable presumptions of how the information source influenced the purchase decision based solely on that information.

According to the present invention, a device may track a user’s interaction with an online information source to determine an engagement magnitude of the user with the information source. For example, the device may track:

  • The number of visits by the user to the information source, particularly re-visits;
  • The duration of the user’s visit and review of the information source;
  • The portion of the information source reviewed by the user (e.g., whether the user scrolled through an entire article, or only scrolled through part of it);
  • Follow-up actions taken by the user, such as following hyperlinks in the information source, bookmarking the information source, or sharing the information source in a social network; and
  • The timing of the interaction with a purchase (e.g., whether the user purchased the product promptly after interacting with the information source, or if extensive time passed).
The device may track such interactions by the user in various ways. First, the device may be the user’s device, and may allow the user to opt into such tracking (e.g., in exchange for coupons or product discounts). Second, the device may be the server of the information source, which may annotate a record of the user’s visit with information about the activities of the user during the visit. Third, user tracking techniques, such as cookies or web bugs, may be utilized to determine that interactions with several information sources were initiated by the same user.

The device may report the details of such interactions to a server, which may correlate the engagement magnitude of the interaction with the customer’s later decision to purchase the product, or even with a decision not to purchase the product (e.g., the customer took the item out of a shopping cart, declined to complete a pending purchase, or removing the product from a “watch list”). The server may utilize a variety of techniques to correlate the purchase decision with each activity through each information source, such as with Bayesian classification, statistical clustering techniques, or artificial neural networks. The correlational weights of the activities and information sources with the purchase decisions, especially aggregated over a large number of customers, reflects the influence of each information source on customers’ purchases. Marketing resources may then be allocated in proportion with the influence magnitude of the information sources on the customers’ purchase decisions.

The difference:

Both examples cover the same business objective. However, the first example focuses on the business objective – the “abstract idea” – as the subject of the disclosure. The second example presents the business objective as the motivation or background; discusses technical difficulties with achieving this result; and then presents a significant amount of detail about how these technical difficulties can be overcome.

This shift in focus directly addresses the Court’s concerns in Alice. The first example does not pertain to a device at all – the device is involved in a superficial or tangential capacity, i.e., it simply “applies” the business method. In the second example, the devices and technology take center stage. The business method is still presented, but as the driving motivation or objective – the focus of the patent is on the specific technical obstacles to achieving the business method, and the technical solutions to such obstacles.

Invention #2: Social Network Identity Authentication

The Invention:
User authentication can be verified by evaluating their interactions within a social network. The individual’s interactions with the contacts of the user within a social network can be automatically tracked and evaluated to confirm or raise doubts about the individual’s claimed identity.


Authenticating the identity of an individual – i.e., establishing that an individual is the person represented by a user profile – is difficult. An individual may submit credentials to be compared with known credentials of the user profile, such as a password or biometrics; however, these credentials may be inaccurate, and can be forged by the individual.

According to the present invention, interactions within a social network may be utilized to assist in identity authentication. An interaction between the individual and a social network contact of the user may be monitored, and a device can automatically determine whether the second individual believes that the individual is the same as the represented user. The strength of the authentication may be affected by the degree to which the contact believes that the individual is also the represented user.


Services and devices often utilize a variety of techniques to authenticate that the identity of an individual matches that of an individual represented by a user profile. To this end, devices may store various credentials in a user profile, such as passwords or biometrics, and may compare the stored credentials with credentials submitted by the individual. However, credential-based detection may be inaccurate and/or prone to forgery, and the service or device may incorrectly permit and/or incorrectly block an individual’s attempt to utilize a particular user profile.

According to the present invention, a device may perform or supplement an authentication of the user identity based on an automated evaluation of the interactions between the individual and contacts of the user, such as within a social network. The device may detect an interaction between the individual and the contact, and may utilize a variety of techniques to evaluate the interaction for indications, where the results of such automated evaluation may support or cast doubt upon the identity of the individual.

In particular, the device may evaluate expressions by the individual in order to identify personal information about the user, and may compare such personal information in the expressions of the individual with the contents of the user profile. As a first example, the device may store personal identifiers of the user (e.g., the names of the user’s family members, pets, school, sports, hobbies, or interests). As a second example, the device may store relationship identifiers of the relationship of the user with the individual (e.g., the user’s nickname for the individual, the names of topics that the user and individual have previously discussed, or the names of events occurring between the user and the individual). The device may also receive such personal identifiers and/or relationship identifiers directly from the user; by examining data sources of the user, such as the user’s calendar or email mailbox; or by identifying such information in previous conversations between the user and the contact. The device may store such information as a set of tokens that represent such information (e.g., proper nouns comprising the names of people, pets, or events). During authentication, the device may search the expressions of the individual for the tokens stored in the user profile to determine whether or not the individual references the personal information. …

Additionally, the device may evaluate a reaction of the contact to the individual’s expressions to determine whether the contact is persuaded of the individual’s identity. As a first example, the device may store a first set of expressions that reflect trust, and a second set of expressions that reflect mistrust. The device may examine the responsive expressions of the contact to detect either set of expressions, and may raise or lower the authentication of the individual’s identity according to such detection. As a second example, the device may evaluate the tone of conversation or voice used by the contact while engaging with the individual, as the contact may be more willing to volunteer personal information or to utilize a warmer tone of voice while communicating with a personal, trusted contact than with a stranger. …

The device may also utilize these techniques in a variety of scenarios. As a first example, the device may passively monitor interactions between the individual and contacts within the social network, e.g., in order to supplement and/or maintain an ongoing authentication of the individual. As a second example, the device may prompt such an interaction. For example, if the individual requests a high-value transaction such as an expensive purchase, the device may spontaneously select a contact within the social network, and may send to the contact a request to initiate an interaction with the individual for the purpose of authentication. Such authentication may be premised upon the current consent of the individual (e.g., “we’d like to send your friend a request to verify your identity”), or upon previously received consent from the user that is stored within the user profile. …

The difference:

The first example may be vulnerable to a 101 rejection – but not because the claimed technique is easy or conventional, of the “here is an abstract idea; now, just ‘apply it'” variety. Rather, the problem is the opposite end of the spectrum: the implementation could be difficult, and could be done in many ways… but no such implementation is discussed. The example attempts to “preempt” any way of achieving these techniques, without actually disclosing significant details about how it’s done. A similar aspect of Alice’s claims was raised during the CLS Bank oral argument, and was determinative of the outcome. 2 Like Alice, this example looks a bit too much like “basically the concept of authenticating a user by asking the user’s friend,” i.e., a “method of organizing human activity,” which can be rejected like other recent cases).

The second example breaks open the “black box” and provides a variety of details that fill in the gaps to show how, specifically, a device or service could achieve this desired result. The key here is that the claims may not need to be limited to these particular details. Rather, a more robust specification may support reasonably broad claims. A negotiation over an acceptable level of detail in the claims can be driven by 102, 103, and 112 – i.e., whether the examiner believes the claims to be duly specific, and different from the cited references – rather than a conclusory rejection under 101.


The purpose of this exercise is hopefully clear: Patent applications can be filed, and patents obtained, for technology that implements a business method – provided that the described technology has its own merit and sufficient disclosure. These may be the types of inventions that the Bilski and Alice Courts had in mind when refusing to declare a categorical exclusion of business methods from patent eligibility.

So what are the takeaway messages from this exercise? We can identify several techniques for drafting applications that are more likely to survive Alice review:

  • During the disclosure interview, review the technology at length with the inventors. Ask how they intend to implement the business method, and why they chose that implementation over others. Ask what problems they encountered during the implementation, and their technical solutions to those problems. And if there isn’t any technical problem or technical solution… it may be best to advise the client of current trends in patent law, and to recommend further development of the abstract idea before pursuing protection.

  • Do not present the business method as a broad idea, where technology is but one expression of the business method, or as “window dressing” thrown over the business method. A cursory reference to “a computer-implemented method” or “a computer program product” will offer no protection from 101. Nor will a cursory reference to a generic advantage, such as “wherein the method conserves bandwidth.” Rather, draft the specification and claims with a focus on the technology implementing the business method. You should be able to point to specific claim elements, in the body of the claim, that provide technical advantages over conventional techniques for this specific invention.

  • Fill the specification with technical details for this particular invention. Discuss the scenarios in which the technique is usable. Discuss possible implementations, preferably more than one, in extensive detail. Discuss optional extensions of the basic technique to add features or further improve its performance. All of these details can be discussed in an open-ended, optional, non-limiting way, and need not be reflected in such precise detail in the independent claims – but including in them in the specification will both reduce the odds of a 101 rejection, and provide fallback options for addressing such a rejection if issued.

  • Cover the achievable technical advantages of the technique in clear, explicit detail – the advantage of the technique over conventional solutions; how the technique solves problems that are otherwise tricky; how the technique improves upon alternative solutions. Even better, include figures that centrally show contrasting examples.

In short, the response to Alice for business method patenting seems clear: More detailed disclosure, with a focus on technology rather than the “abstract” business method. This is the unstated objective of the Alice decision, and also a positive step in the push for “patent quality.”


  1. According to Bilski v. Kappos:

    Section 101 precludes a reading of the term “process” that would categorically exclude business methods. The term “method” within § 100(b)’s “process” definition, at least as a textual matter and before consulting other Patent Act limitations and this Court’s precedents, may include at least some methods of doing business. The Court is unaware of any argument that the “ordinary, contemporary, common meaning,” Diehr, supra at 182, of “method” excludes business methods. Nor is it clear what a business method exception would sweep in and whether it would exclude technologies for conducting a business more efficiently. The categorical exclusion argument is further undermined by the fact that federal law explicitly contemplates the existence of at least some business method patents: Under § 273(b)(1), if a patent-holder claims infringement based on “a method in [a] patent,” the alleged infringer can assert a defense of prior use. By allowing this defense, the statute itself acknowledges that there may be business method patents. Section 273 thus clarifies the understanding that a business method is simply one kind of “method” that is, in some circumstances, eligible for patenting under § 101. A contrary conclusion would violate the canon against interpreting any statutory provision in a manner that would render another provision superfluous.

  2. The following statements were offered during the CLS Bank oral argument:

    That is a method claim dressed up in a generic system. It says: Use any computer, any telephone, any hard drive. And then look at the programming claims, look at figure 36 – this isn’t a logic flow. This cannot allow a person skilled in the art to program this computer. This simply says: do we have multi-lateral netting available? Put it in the black box and see what comes out. The black box is never claimed. The black box is never described.


Your article does not seem to indicate what impact Alice has on previous patents.

Harvey: I appreciate your comment – and that is certainly an interesting topic.

Throughout this blog, I’ve written extensively about the impact of Alice on patents past, present, and future. This particular article is solely forward-looking: how do practitioners draft new patent applications that are likely to satisfy Alice? (Also, even earlier in the process: if we have an invention that we can’t describe in this way, should we be filing a patent application on it at all?)

But for the retrospective question that you posed: That is, literally and figuratively, the million-dollar question. Here, we are at a handicap: we are stuck with applying the requirements of Alice to specifications that were drafted and filed well before that opinion.

These questions become a salvage operation: we have to dig through the specification to see if we can pull out some narratives that will support our arguments for Alice sufficiency. If the drafter was sufficiently clairvoyant to predict where patent law might go (or lucky enough to have developed that kind of drafting style), then we might find something. If not… well, there have been a few instances in the last year where I’ve had to recommend abandonment of an application for an invention that might have specified Alice, but where the specification was simply not adequately detailed.

If specification support is not strong enough to stand on its own, two interesting questions arise:

  1. In what scenarios can arguments be made about the Alice-sufficiency of the case, even where such arguments are not (fully) supported by the specification?

    There are at least some scenarios where this is a valid tactic. Let’s say that the invention is a compression algorithm comprising steps (ABC), and the specification notes that it’s useful for a particular type of data (X). The examiner rejects it as an “abstract idea” because it just looks like a conventional compression technique – i.e., the examiner doesn’t see any specific value. You might be able to demonstrate why this algorithm is useful for (X) – e.g., test results showing that the algorithm compresses (X) at a rate of 50% better than conventional techniques. Even if that information isn’t in the specification, it is the inevitable result of the invention, and the evidence should overcome the examiner’s perceived lack of utility.

  2. Can you file a continuation-in-part that relies on the priority date of the parent for the recited technology, and that adds a discussion that satisfies Alice? It’s a dicey question – CIPs are so fraught with issues that some practitioners avoid them altogether – but it might be a valid option in some circumstances. Moreover, if the inventors have additional variations developed after the parent, it would be entirely possible to pursue both the original and the CIP concurrently.

If you have thoughts about these tactics or the general question, by all means, please share them! This is an excellent topic worth much discussion.

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